KSU “Quick Analysis” of the 6/30/2015 USDA Acreage Report

On Tuesday, June 30, 2015 the USDA National Agricultural Statistics Service (NASS) released its 2015 USDA Acreage Report and its June 1, 2015 Quarterly Stocks Report.  There were a number of market surprises in the 2015 USDA Acreage Report, including:

A. U.S. Corn Acreage in 2015

The USDA projected 2015 U.S. Corn planted acreage to be 88.897 million acres (ma) – down 395,000 (-0.4%) from pre-report expectations.  Planted acreage of 88.897 ma in 2015 would be the lowest amount since 2010, being down from 90.597 ma planted in 2014, 95.365 ma in 2013, and 97.291 ma in 2012.

The USDA also projected 2015 U.S. Corn harvested acreage to be 81.101 ma (91.2% harvested-to-planted acres) – down from 83.136 ma harvested in 2014 (91.8% hvstd/plntd), 87.451 ma in 2013 (91.7% hvsted/plntd), and 87.365 ma in 2012 (89.8% hvstd/plntd).

Market Impact: Using the USDA’s June 10th World Agricultural Supply and Demand Estimates (WASDE) report projected 2015 U.S. corn yield of 166.8 bu/ac, corn production in the U.S. in 2015 would be 13.528 billion bushels (bb) – down 102 mb from the June 10th USDA forecast of 13.630 bb.  All else being equal, the USDA’s forecast of ending stocks would be reduced by the same amount down to 1.669 bb, with ending stocks-to-use down to 12.1% from 12.9% in the June 1oth WASDE report.  Projected U.S. corn prices for “new crop” 2015/16 would be expected to be adjusted higher from $3.50 by at least a small-to-moderate amount – likely $0.25-$0.50 per bushel higher.

B. U.S. Soybean Acreage in 2015

The USDA projected 2015 U.S. Soybean planted acreage to be 85.139 ma – down 3,200 acres from pre-report expectations.  Planted acreage of 85.139 ma in 2015 would be a record high, being up from the previous record of 83.701 ma planted in 2014, 76.840 ma in 2013, and 77.198 ma in 2012.

The USDA also projected 2015 U.S. Soybean harvested acreage to be 84.449 ma (99.2% harvested-to-planted acres) – up from 83.061 ma harvested in 2014 (99.2% hvstd/plntd), 76.253 ma in 2013 (99.2% hvsted/plntd), and 76.144 ma in 2012 (98.6% hvstd/plntd).

Because of wet weather conditions and delayed plantings of soybeans in selected states in May and early June, the USDA indicated that it will re-survey agricultural producers in Kansas, Arkansas and Missouri in regards to soybean planted acreage.  The USDA indicated that if the new survey data justifies changes to the June 30th Acreage report estimates, such changes would be published in the August 12th USDA NASS Crop Production report.

Market Impact: Using the USDA’s June 10th World Agricultural Supply and Demand Estimates (WASDE) report projected 2015 U.S. soybean yield of 46.0 bu/ac, soybean production in the U.S. in 2015 would be 3.885 bb – up 35 mb from the June 10th USDA forecast of 3.850 bb.  All else being equal, the USDA’s forecast of ending stocks would be increased by the same amount – up to 510 mb, with ending stocks-to-use up to 13.7% from 12.7% projected in the June 10th WASDE report.  Projected U.S. soybean prices for “new crop” 2015/16 would be expected to be adjusted marginally lower from $9.00 by a small amount – likely down $0.10-$0.25 per bushel.

C. U.S. Wheat Acreage in 2015

The USDA projected 2015 U.S. Wheat planted acreage to be 56.079 ma – up 212,000 acres from pre-report expectations.  Planted acreage of 56.079 ma in 2015 would be down from 56.822 ma planted in 2014, 56.236 ma in 2013, and 55.294 ma in 2012.  On the basis of wheat type, planted acreage of 2015 U.S. winter wheat of 40.620 ma came in 0.5% below pre-report expectations, down to the lowest level since at lease 2012.  Planted acreage of 2015 U.S. other spring wheat of 13.505 ma came in 2.2% above pre-report expectations, up to the highest level since at least 2012.  Planted acreage of 2015 U.S. durum wheat of 1.954 ma came in 8.0% above pre-report expectations, up to the highest level since 2.138 ma in 2012.

The USDA also projected 2015 U.S. Wheat harvested acreage to be 48.545 ma (82.1% harvested-to-planted acres) – up from 46.381 ma harvested in 2014 (81.6% hvstd/plntd), and 45.332 ma in 2013 (80.6% hvsted/plntd), but down from 48.758 ma in 2012 (88.2% hvstd/plntd).

Market Impact: Using the USDA’s June 10th World Agricultural Supply and Demand Estimates (WASDE) report projected 2015 U.S. wheat yield of 44.2 bu/ac, wheat production in the U.S. in 2015 would be 2.145 bb – up 24 mb from the June 10th USDA forecast of 2.121 bb.  All else being equal, the USDA’s forecast of ending stocks would be increased by the same amount – up to 838 mb, with ending stocks-to-use up to 38.8% from 37.7% projected in the June 10th WASDE report.  Projected U.S. soybean prices for “new crop” 2015/16 would be expected to be adjusted marginally lower from $4.90 by a small amount – likely down $0.05-$0.10 per bushel.

D. U.S. Grain Sorghum Acreage in 2015

The USDA projected 2015 U.S. Grain Sorghum planted acreage to be 8.840 million acres (ma) – up 930,000 (+11.8%) from pre-report expectations.  Planted acreage of 8.840 ma in 2015 would be up from 7.138 ma planted in 2014, 8.076 ma in 2013, and 6.259 ma in 2012.

The USDA also projected 2015 U.S. Grain Sorghum harvested acreage to be 7.773 ma (87.9% harvested-to-planted acres) – up from 6.401 ma harvested in 2014 (89.7% hvstd/plntd), 6.585 ma in 2013 (81.5% hvsted/plntd), and 4.995 ma in 2012 (79.8% hvstd/plntd).

Market Impact: Using the USDA’s June 10th World Agricultural Supply and Demand Estimates (WASDE) report projected 2015 U.S. grain sorghum yield of 64.9 bu/ac, grain sorghum production in the U.S. in 2015 would be 504 million bushels (mb) – up 69 mb from the June 10th USDA forecast of 435 mb.

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http://www.wilsonks.com/images/other/Wilson%20Lake%20Rocktown%202011%20%20(500x333).jpg

Wilson Lake in Central-Western Kansas (Source: http://www.wilsonks.com/wilson_lake.htm)

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